Meta’s Kustomer Remained Stagnant Since Takeover

As part of attempts to refocus on its main business, Meta Platforms reportedly laid out intentions to offload business software startup Kustomer, which it purchased in 2022.

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According to sources cited by Trade Algo, Meta Platforms decided Kustomer was a non-core asset early this year because it was costing the company too much money to maintain.

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In 2020, Meta Platforms made a move to acquire Kustomer software in a deal that valued the company at $1 billion. Kustomer software collects interactions from several sources and consolidates them onto a single screen.

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The regulatory review process delayed completion, but Meta Platforms promoted the partnership as a step in a larger plan to allow companies utilize the Facebook Messenger and WhatsApp apps for customer care.

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The CEO of Meta Platforms, Mark Zuckerberg, stated plans at the beginning of the year to are becoming more efficient and remove projects that are underperforming as a result of decreasing digital advertising sales and a broader downturn in the technology business.

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Kustomer would fit into that group; according to Trade Algo, the company has spent $200 million on operating and one-time costs since the purchase closed, and revenue has stagnated.

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The current economic climate means that Meta Platforms could still hang onto a minor interest in Kustomer, but its value will be considerably lower than what it paid.

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According to Ryan Moore, a spokesman for Meta Platforms, the company was "exploring strategic alternatives for Kustomer" but had decided to concentrate on WhatsApp's income prospects.